The Twitter chart suggests that the rally is over (but with caveats...)

The charts can still go either way: extend once more and send TVIX to $2.20 or begin to break down pretty much from the open tomorrow.  As usual I try to get as many views of the data as time allows.  Today I thought it might be instructive to look at the social media charts.  TWTR is the poster child of useless social media stocks so I put a wave count on it today and that count does not look positive for the markets.  TWTR will not rise or fall alone.  It is just a leveraged version of the broader markets now.

The A and B waves are beyond question.  1 of C and 2 of C are also pretty good guesses given the massive gap up during 3 of 3 of C.  If you look closely you can see 5 tiny waves up just after blue 2.  the was 1 of 3 of C.  Then a tiny pullback into 2 of 3 of C. Then a massive gap into 3 of 3 of C.

IFF we take that much of the C wave count as granted then wave blue 4 is also a no brainer and so the only question is 5 of C.  Since neither 1 of C nor 3 of C in this model were extended then it is good to see that 5 of C was indeed extended.  In fact, the wave structure is quite clear and it includes parallelism and alternation. 

Caution: There is also the chance that we are really only looking at 1-2-3 of C which means that the dip to $47.50 was 4 of C and we are now working on 5 of C.  So, blue 3 below would really be blue 1 in this alternate count and blue 5 would really be blue 3.  There are 2 things I like about the alternate count (which makes me wary that it might happen!).

1: The wave count is so clear.  This usually happens in 3rd waves or C wave but I would expect it to be very good in a 3rd of C.  Also,
2: It looks like the move up into $53.50 was a rising wedge and I have made it clear that I think that has been tied to 3rd waves for a long time. So the alternate count is not a distant second.  It is mainly that huge gap that I suspect is a 3rd of 3rd of C that gives the primary model the nod over the alternate one.  Tomorrow we should learn how this is going to go.  I wonder if the herd will rally into the Scottish independence vote and then panic when they vote for independence.  The vote is too close to call from the polls but I'm going to have to lean toward independence simply because that is where I think the pendulum is swinging in terms of social mood: away from centralized power and control, less power for the bureaucrats and more power for the rugged individualists.  It will be an interesting vote for me from that perspective....

Either chart model will be fine with me.  I know that if this chart does not see a lower low very soon that we are probably looking at wave 5 forming and in that case it could move TWTR up to the 61.8% fib which is a good 15% up from here.  TVIX will get slammed again if that happens and so you have to let your stops take you out.  Anything below the old low of about $2.59 is clearly a sell for now.  Don't worry about taking the hit because you will be able to get back in at a lower price and you will end up with more shares.

King and rook vs. king folks.  Don't get worried, pushed, rushed or tired.  Trees don't grow to the sky and this bull is very long in the tooth.